Samacheer Kalvi 11th Commerce Guide Chapter 3 Classification of Business Activities

Tamilnadu State Board New Syllabus Samacheer Kalvi 11th Commerce Guide Pdf Chapter 3 Classification of Business Activities Text Book Back Questions and Answers, Notes.

Tamilnadu Samacheer Kalvi 11th Commerce Solutions Chapter 3 Classification of Business Activities

11th Commerce Guide Classification of Business Activities Text Book Back Questions and Answers

I. Choose the Correct Answer.

Question 1.
The industries engaged in extraction of iron ore are known as ………………
a. Construction Industries
b. Manufacturing Industries
c. Extraction Industries
d. Genetic Industries
Answer:
c. Extraction Industries

Question 2.
Auxiliaries to trade is also called as ……………
a. Trade
b. Advertisement
c. Warehousing
d. Aids to Trade
Answer:
d. Aids to Trade

Question 3.
Production which involves several stages for manufacturing finished products is known as …………………..
a. Analytical Industry
b. Synthetic Industry
c. Processing Industry
d. None of the above
Answer:
c. Processing Industry

Question 4.
Normally high level risk involved in ……………….
a. Industry
b. Commerce
c. Trade
d. All of the above
Answer:
a. Industry

Question 5.
Commerce is mainly concerned with ………………….
a. Connecting producer and consumer
b. Pricing of Goods
c. Buying and Selling of goods
d. Manufacturing of goods
Answer:
a. Connecting producer and consumer

II. Very Short Answer Questions

Question 1.
Define commerce:
Answer:
According to Evelyn Thomas, “Commercial operations deal with the buying and selling of goods, the exchange of commodities and the contribution of finished products”.

Question 2.
What do mean by industry?
Answer:
Industry refers to economic activities which are connected with conversion of resources into useful goods. The term is used for activities in which mechanical appliances and technical skills are involved. E.g Electronic industry would include all firms producing electronic goods, and so on.

Question 3.
What is trade?
Answer:
The term ‘trade’ is used to denote buying and selling. It is an essential part of commerce.

Question 4.
Write a short note on transportation.
Answer:
Transport or transportation is the medium which helps the movement of humans, animals and goods from one location to another. Since all the goods produced cannot be consumed in the place of production, it should be move to the places where they are demanded. The process of moving goods is known an transportation.

III. Short Answer Questions

Question 1.
Distinguish between Extractive industries and genetic industries.
Answer:
Extractive industries:

• These industries extract or draw out products from natural sources.
• Extractive industries supply some basic raw materials that are mostly products of the geographical or natural environment.

Genetic industries:

• These industries remain engaged in breeding plants and animals for their use in further reproduction.
• The seeds, nursery companies poultry, dairy, piggery, hatcheries, nursery, fisheries, apiary etc.

Question 2.
What do you mean by tertiary industries?
Answer:
The industries which produces utility services and sell them at the profit. These industries help trade, commerce and industry. The auxiliaries to trade like banking, insurance, warehouse, advertisement etc. are included in this.

Question 3.
Write any three characteristics of commerce.
Answer:
1. Economic Activity: Commerce is an economic activity because it consists of activities which are undertaken for earning profits. A trader buys goods with the aim of selling them at a profit.

2. Exchange of Goods and Services: Commerce involves the exchange and distribution of goods and services. Goods may be purchased or produced for sale. Commerce comprises both trade and aids to trade.

3. Profit Motive: The motive of commercial activities is to earn profits. Any activity which does not have the aim of profit will not be a part of commerce.

Question 4.
Narrate commerce with an example.
Answer:
Commerce includes all the activities which help in bringing goods from the producer to the’ ultimate consumer. According to Evelyn Thomas, “Commercial operations deal with the buying and selling of goods, the exchange of commodities and the contribution of finished products”. Commerce includes services such as transport, warehousing, packaging, insurance, banking and sales promotion which are incidental or auxiliaries to trade.

IV. Long Answer Questions

Question 1.
Explain the various kinds of industries on the basis of size.
Answer:
1. Micro Units: A unit wherein investment in plant and machinery is upto Rs. 25 lakhs in case of manufacturing and upto Rs. 10 lakhs in case of service enterprises.

2. Small Units: A manufacturing unit wherein investment in plant and machinery is more than Rs. 25 lakhs but does not exceed Rs.5 crore. In the case of service enterprises, these limits are Rs. 10 lakhs and Rs. 2 crores respectively.

3. Medium Units: A manufacturing unit wherein investment in plant and machinery is more than Rs.5 crore but does not exceed Rs. 10 crore. In the case of service enterprises, these limits are Rs.2 crore and Rs.5 crore respectively.

4. Large Units: A manufacturing unit wherein, investment in plant and machinery exceeds Rs.10 crore. In the case of a service unit investment in equipment exceeds Rs.5 crore.

Question 2.
Compare industry, commerce, and trade.
Answer:

SI. No	Variables	Industry	Commerce	Trade
1.	Meaning	Extraction,reproduction,conversion, processing and construction of useful products	Activities involving the distribution of goods and services	Purchase and sales of goods and services
2.	Scope	Consists of all activities involving conversion of material and semi-finished into finished goods.	Comprises trade auxiliaries to trade	Comprises exchange of good. and services
3.	Capital	a large amount of capital is required	Need for capital is comparatively less	Small capital is needed to maintain stock and to grant credit
4.	Risk	High risk is involved	Relatively less risk is involved	Relatively less risk is involved
5.	Side	It represents the supply side of goods and services	It represents the demand side of goods and services	It represents both supply and demand
6.	Utility creation	It creates form utility by changing the form or shape of materials	It creates place utility by moving goods from producers to consumers	It creates possession utility through exchange.

Question 3.
What are the characteristics of commerce?
Answer:
1. Economic Activity:
Commerce is an economic activity because it consists of activities which are undertaken for earning profits. A trader buys goods with the aim of selling them at a profit.

2. Exchange of Goods and Services:
Commerce involves the exchange and distribution of goods and services. Goods may be purchased or produced for sale. Commerce comprises both trade and aids to trade.

3. Profit Motive:
The motive of commercial activities is to earn profits. Any activity which does not have the aim of profit will not be a part of commerce.

4. Regularity of Transaction:
An isolated transaction does not imply commerce.

5. Creation of Utilities:
Commerce creates several types of utilities. It creates place utility by carrying goods to the place where they are needed. It makes goods available as and when demanded thereby creating time utility. By creating these utilities commerce helps to increase the volume of trade.

Question 4.
Write short notes on:

1. Analytical industry
2. Genetic industry and
3. Construction industry.

Answer:
1. Analytical industry:
These industries are called Secondary industries. These industries analyses and separates different elements from the same material, as in the case of oil refinery. In these industries the raw material is broken down into several useful materials.
E.g an oil industry separates crude oil into keroseñe, gasóline, diesel oil and petrol etc.

2. Genetic Industry:
The word ‘Genetic’ means parentage or hereditary. Genetic industries are concerned mainly with producing  breeding or multiplying of certain species of plants or animals with the object of earning profits from their sale. Examples of these types are nurseries, forestry, cattle-breeding, and commercial kennels. Animal husbandry is one type of Genetic Industry.

3. Construction Industry:
These industries are involved in the construction of building, dams, bridges, roads as well as tunnels and canals.

Question 5.
Briefly explain the auxiliaries to trade.
Answer:
Meaning:

Auxiliaries of trade may be classified into five categories:
1. Transportation:
Selling all the goods produced at or near the production place is not possible. Hence, goods are to be sent to different places where they are demanded.

2. Banking and Finance:
Nowadays we cannot think of a business without a bank. A bank is an organization which accepts deposits of money from the public, withdrawals on demand or otherwise, and lends the same to those who need it. Necessary funds can be obtained by businessmen from a bank. Thus, banking helps business activities to overcome the v problem of finance.

3. Insurance:
Business involves various types of risks. Materials and goods held in stock or in transit are subject to the risk of loss or damage. Insurance provides protection in all such cases. On payment of a nominal premium, the amount of loss or damage and compensation for an injury, if any, can be recovered from the insurance company.

4. Warehousing:
Goods are held in stock to make them available as and when required. Special arrangements must be made for the storage of goods to prevent loss or damage. Warehousing helps business firms to overcome the problem of storage and facilities the availability of goods when needed.

5. Advertising:
Advertising is one of the most important methods of promoting the sale of products, particularly, consumer goods like electronic goods, automobiles, soaps, detergents, etc. Advertising helps in providing information about available goods and services and inducing customers to buy particular items.

11th Commerce Guide Classification of Business Activities Additional Important Questions and Answers

I. Choose the Correct Answer:

Question 1.
All business activities can be classified into ……………. broad categories.
(a) Two
(b) Three
(c) Four
(d) Five
Answer:
(a) Two

Question 2.
Manufacturing industries may be categorized into ………………
a) Two
b) Three
c) Four
d) Ten
Answer:
c) Four

Question 3.
Horticulture is an example for …………….
(a) Primary industry
(b) Secondary industry
(c) Tertiary industry
(d) Local industry
Answer:
(a) Primary industry

Question 4.
…………………. industries produce utility services and sell them at a profit.
a) Construction Industries
b) Tertiary Industries
c) Analytical Industries
d) Manufacturing Industries
Answer:
b) Tertiary Industries

Question 5.
Professional or specialized skills and high technology are used to provide ……………. type of services.
(a) Personalised
(b) Public
(c) Distributive
(d) Quaternary
Answer:
(d) Quaternary

Question 6.
Expand MSME:
a) Major Small Medium Enterprises
b) Micro Scale. Middle Enterprises
c) Micro Small Medium Enterprises
d) Medium Small Micro Enterprises
Answer:
c) Micro Small Medium Enterprises

Question 7.
The service Enterprises with a maximum investment of 5 crores Is known as …………
a) Micro Unit
b) Small Unit
c) Large Unit
d) Medium Unit
Answer:
d) Medium Unit

Question 8.
Special arrangements must be made for goods to prevent loss or damage.
(a) Transportation
(b) Pricing
(c) Storage
(d) Advertising
Answer:
(c) Storage

Question 9.
Which of the following is not categorized as commerce?
a) Buy goods with ‘the aim of selling at profit.
b Exchange and Distribution of goods and services.
c) An individual sells his asset.
d) None of the above.
Answer:
c) An individual sells his asset.

Question 10.
Auxiliaries of trade are also called……………………
a) Trade
b) Advertisement
c) Warehousing
d) Aids to trade
Answer:
d) Aids to trade

Question 11.
The production which Involves several stages for manufacturing finished products Is known as………….
a) Analytical Industry
b) Synthetic Industry
c) Processing Industry
d) None of the above
Answer:
c) Processing Industry

Question 12.
Normally high-level risk involved in ………………….
a) Industry
b) Commerce
c) Trade
d) All the above
Answer:
a) Industry

Question 13.
Commerce is mainly concerned with
a) Distribution of Goods
b) Pricing of Goods
c) Buying and Selling of Goods
d) Manufacturing of Goods
Answer:
b) Pricing of Goods

II. Very Short Answer Questions

Question 1.
What is the Extractive industry?
Answer:
Extractive industries extract or draw out products from natural sources. Extractive industries supply some basic raw materials that are mostly products of the geographical or natural environment.

Question 2.
What do you mean by Tertiary Industries?
Answer:
The industry which produces utility services and sells them at a profit is known as tertiary industries:
They do not produce goods. They help in trade, industry, and commerce. It is also known as the Service industry.
E.g: The tourism and Hospitality industry, banking industries, etc.

Question 3.
What is the Secondary industry?
Answer:
Secondary Industries are concerned with using the materials which have already been extracted at the primary stage. These industries process such materials to produce goods for final consumption or for further processing by other industrial units.

III. Short Answer Questions.

Question 1.
Write any three categories of Manufacturing industries.
Answer:

1. Analytical Industry analyses and separates different elements from the same materials, as in the case of an oil refinery.
2. The synthetic Industry combines various ingredients into a new product, as in the case of cement.
3. The processing Industry involves successive stages for manufacturing finished products, as in the case of sugar and paper.

IV. Long Answer Questions

Question 1.
Write short notes on Primary Industries.
Answer:
These industries concerned with the production of goods with the help of nature. It is a nature-oriented industry, which requires very little human effort, for example, Agriculture, farming, forestry, fishing, horticulture, etc.
These industries are subdivided as follows:

Extractive Industries:
These industries extract or draw out products from natural resources. These industries supply some basic raw materials that are mostly products of the geographical or natural environment. These products are transformed into other manufacturing industries. These industries include farming, mining, lumbering, hunting and fishing operations.

Genetic Industries:
These industries engaged in breeding plants and animals for their use in further reproduction. The seeds, nursery companies, poultry, dairy, piggery, hatcheries, nursery, fisheries, apiary, etc are some of the examples of genetic industries.

Question 2.
Write a short note on Secondary Industries.
Answer:
These industries produced goods for final, consumption or for further processing by other industrial units. For example, the mining of iron ore is a primary industry, but the manufacturing of steel is a secondary industry.

It can be categorized as follows:

• Manufacturing Industries: These industries are engaged in producing goods through the processing of raw materials and thus creating from utilities. These industries may be further divided into four categories on the basis of the method of Operation for production.
• Analytical Industry: Which analyses and separates different elements from the same materials, as in the case of an oil refinery.
• Synthetically Industry: Which combines various ingredients into new products, as in the case of cement.
• Processing Industry: Which involves successive stages for manufacturing finished products, as in the case of sugar and paper.
• Assembling Industry: Which assembles different component parts to make a new product, as in the case of television, car, computer, etc.
• Construction Industries: These industries are involved in the construction of buildings, dams, bridges, roads as well as tunnels and canals.

Question 3.
Write a note on Tertiary industries.
Answer:
The industries which produce utility services and sell them at the profit. These industries help trade, commerce, and industry. The auxiliaries to trade like banking, insurance, warehouse, advertisement, etc are included in this. These industries are further classified as under:

• Personalized service: The individuals and private institutions selling their services to others is called personalized services. E.g Plumber, servant maid, etc.
• Public service: The government provides services to the people without profit motive through Government hospitals, schools, police, government offices, etc.
• Distributive service: Transportation, sales, warehousing, logistics, salesmanship, etc. come under this type of service.
• Financial service: Banking, factoring, accounting, and insurance, etc. are grouped under this type of service.
• Quaternary service: Professional or specialized skills and high technology are used to provide this type of service. E.g. Software development, Auditing, Research, and Development, etc.
• Quinary service: Selective individual experts create new ideas, implement new technologies and implement new policies. These decisions influenced the growth and development of national and international institutions.